Correlation Between Kura Sushi and Globalfoundries
Can any of the company-specific risk be diversified away by investing in both Kura Sushi and Globalfoundries at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Kura Sushi and Globalfoundries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kura Sushi USA and Globalfoundries, you can compare the effects of market volatilities on Kura Sushi and Globalfoundries and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Kura Sushi with a short position of Globalfoundries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kura Sushi and Globalfoundries.
Diversification Opportunities for Kura Sushi and Globalfoundries
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Kura and Globalfoundries is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Kura Sushi USA and Globalfoundries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Globalfoundries and Kura Sushi is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Kura Sushi USA are associated (or correlated) with Globalfoundries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Globalfoundries has no effect on the direction of Kura Sushi i.e., Kura Sushi and Globalfoundries go up and down completely randomly.
Pair Corralation between Kura Sushi and Globalfoundries
Given the investment horizon of 90 days Kura Sushi is expected to generate 2.07 times less return on investment than Globalfoundries. But when comparing it to its historical volatility, Kura Sushi USA is 1.15 times less risky than Globalfoundries. It trades about 0.13 of its potential returns per unit of risk. Globalfoundries is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 3,601 in Globalfoundries on September 5, 2024 and sell it today you would earn a total of 862.00 from holding Globalfoundries or generate 23.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kura Sushi USA vs. Globalfoundries
Performance |
| Timeline |
| Kura Sushi USA |
| Globalfoundries |
Kura Sushi and Globalfoundries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kura Sushi and Globalfoundries
The main advantage of trading using opposite Kura Sushi and Globalfoundries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kura Sushi position performs unexpectedly, Globalfoundries can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Globalfoundries will offset losses from the drop in Globalfoundries' long position.| Kura Sushi vs. Hyatt Hotels | Kura Sushi vs. Smart Share Global | Kura Sushi vs. Wyndham Hotels Resorts | Kura Sushi vs. WW International |
| Globalfoundries vs. NXP Semiconductors NV | Globalfoundries vs. Analog Devices | Globalfoundries vs. ON Semiconductor | Globalfoundries vs. Lattice Semiconductor |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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